The South African Government has announced changes to its mining policy and regulations, requiring companies to increase ownership rights of black shareholders.
Called the '2017 Mining Charter, An Instrument of Change: Giving Practical Expression to Radical Economic Transformation', the new policy is expected to address many of the inequalities in the mining and minerals sector prior to 2002.
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According to the proposed changes, a new prospecting right must have a minimum of 50% plus 1 Black Person shareholding, including voting rights.
Regarding employment, the charter seeks to ensure that black representation at different hierarchies of employment is proportionate to the country's demographics.
Amendments in connection with employment equity include a minimum of 50% black representation at board level, and at a top management level, in addition to a minimum of 88% black representation is required at junior management level.
South Africa Mineral Resources Minister Mosebenzi Zwane said: "Mindful of our imperatives to radically advance the meaningful inclusion and participation of all South Africans in the economy, we are cognisant of the fact that mining cannot exist in a vacuum.
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By GlobalData"In order for the sector to thrive, it requires strong and supportive legislative and fiscal regimes."
In a response, the Chamber of Mines of South Africa rejected the proposed policy changes, terming the action of the department as ‘unilateral’ and ‘seriously flawed’.
Chamber of Mines president Mxolisi Mgojo said: “It would be irresponsible of the industry to accede to unworkable targets and unnecessary institutions that are not founded in reality, or that do not have the interests of the industry at its heart."
The industry body stated that it will follow legal recourse to seek suspension of the implementation of the charter.
